Orders for durable goods, or such long-lasting items as jet aircraft, washing machines, cars, and computers, eased back by 1.0% in January, as demand tapered for some big-ticket items save for military hardware.
However, the pullback was somewhat less severe than the 2.0% drop that had been the consensus forecast for last month. In December, such orders had tumbled by 5.3%. That represented a downward revision to the initially estimated 4.5% decline for the final month of last year.
Breaking the report down, we find that aircraft orders tumbled by 20.2% in January on fewer bookings by a large aircraft maker. Also, bookings for autos were off by 2.2%. Overall, orders for transportation-related equipment declined 5.6%, largely, of course, due to the plunge in aircraft orders.
Meanwhile, stripping out the volatile transportation component, we find that orders actually increased last month, in an encouraging development, the Commerce Department said.
Moreover, military orders snapped back last month from a large decline in December. Overall, though, orders fell in most other categories. In one especially welcome note, however, orders for capital goods, which are a guide to potential business, or capital, investment, increased by a solid 1.7%. This sector had pressed lower in December.
On the whole, we sense that the poor aggregate showing in December and the uneven performance in January were partly weather related. And given the similar temperature and snow patterns in February, we sense that some continuing pressure will be seen on this month's performance. Durable goods data for February will be out late next month.
At the time of this article's writing, the author did not have positions in any of the companies mentioned.